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Argendollars are now close to US$16,000 million

February 7, 2024 – 16:40

While deposits in pesos suffer liquefaction, those denominated in dollars continue to show encouraging performance. In 2024 they grew by more than US$230 million.

The stock of private deposits in dollars recorded a significant recovery in recent times, reaching levels not seen since April of last year. Data from the Central Bank (BCRA) thus show that the trend continued, although at a slower speed. At the end of last January, the total dollar deposits of the private sector (argentollars) was around US$16,000 million. This represents an increase, in absolute terms, of US$232 million so far this year.

The figure is not minor since, as they tend to grow at the end of each year for tax reasons, it is also common for many of these placements to come out again after the beginning of the new fiscal period. However, for now, the argentollars They show some stability and slight growth. Which is not a fact to be ignored either, given that the argentólares have a direct line with the international reserves of the central bank (BCRA). Because the Argentollar reserve requirements, which is the portion of the deposit that banks cannot lend but rather keep as a liquidity requirement, are computed as part of the BCRA’s gross reserves. Therefore, when they grow they positively impact the stock of gross reserves and vice versa. This is how the BCRA’s reserves also showed an increase of almost US$270 million in December and almost US$700 million last January linked to Argentollar reserve requirements.

It is worth remembering that last year, in the middle of the electoral process, the Argendolares suffered from political ups and downs and economic uncertainty. In this way, between January and July, the stock recorded a drop of more than US$825 million, while between August and November it intensified to more than US$1,360 million. In other words, almost US$2.2 billion left the banks, and therefore the BCRA reserves also suffered.

Recovery of private deposits in dollars

Everything changed last December when an absolute increase of more than US$1.6 billion was recorded, which is intertwined with the change of government and the fiscal reasons mentioned. In any case, today the total of argentollars shows an increase in the last two months of more than US$ 1,800 million, which given the delicate situation of the BCRA reserves is still an encouraging figure.

Who are the holders of these deposits? Approximately two-thirds belong to people distributed in more than 14 million dollar bank accounts, both savings accounts and time deposits. Where, on average, half a million of these accounts have a balance greater than $3,000. The other third is in the hands of companies and societies, which also include mutual funds and insurance companies.

But of the total stock, just over half of the Argendollars are for amounts less than US$100,000, while placements of up to one million dollars are just over 20% and 28% exceed one million dollars.

Receipt for holders of “argendollars”

So, More than 60% of Argendollar holders are mostly individuals or families, with accounts with average balances of US$50,000.. There are almost half a million accounts that have average balances of between US$3,000 and US$50,000, which speaks of how atomized the non-corporate stock is. A few have deposits of more than $500,000, there are less than 1,000 accounts. This explains, in part, the behavior of the stock of these deposits, where the majority of retail savers use them as a substitute for a “free” safe deposit box. While the corporate segment, regulated companies and companies such as insurance companies or mutual funds sometimes have some restrictions and may not freely dispose of their holdings. There are also companies linked to the foreign trade business that use argendollars as part of their working capital linked to operations abroad and not as a financial instrument. In this segment, more than two thirds are in the hands of 700 companies.

It is worth remembering that, on the worst day of the 2019 bullfight, more than US$1 billion was lost, which today would be equivalent to 6.25% of the total stock. The argentollar system remains stable, the banks have liquidity and have only lent a little more than US$3.3 billion to exporting companies or companies that receive foreign currency, and thus there is no currency mismatch.

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